Accounting Flow For The Cost of A WIP Job

This FAQ will go over the general accounting flow for the cost of a WIP Job.

All cost ends up in the WIP account prior to the job posting. Job posting then takes all of the cost for the job and divides it up into each assigned job class (MAT, LABOR, etc.) and posts it into that class’s assigned COGS account.

If the job is posted, or if the material is posted on an invoice instead of a job transfer, the cost will post to COGS directly and not pass through WIP.

To view which accounts were affected by the posting of a transaction, use the “GL Recap” button. More information on that can be found here: GL Recap

Stock Item

Cost goes into the WIP account when the job transfer for that item is posted.

Nonstock Item

Cost goes into WIP clearing account when the voucher for it posts, then moves from WIP Clearing to WIP when the job transfer for that item is posted. 

Manufactured Item

Cost goes into the item’s standard posting (Inventory/COGS) account when it is completed in production. Cost pulls out of the item’s standard posting account and into WIP account when the job transfer for that item is posted.